Gold prices rose on Thursday, hovering close to a key $2,000 per ounce level, as an overall weaker U.S. dollar and lower Treasury yields buoyed demand for bullion.
Spot gold was up 0.4% at $1,997.39 per ounce, as of 0354 GMT, after hitting a three-week high of $2,007.29 on Tuesday.
U.S. gold futures gained 0.3% to $1,998.60.
"The anticipation of this effective pivot towards interest rate hike cycle peak is translating to ongoing softness in the U.S. dollar and the longer-dated U.S. yield which will support gold prices, at least in the short term," said Kelvin Wong, senior market analyst for Asia Pacific at OANDA.
The dollar was down 0.1% against its rivals after gains in the last two sessions, making gold less expensive for other currency holders.
The benchmark U.S. 10-year Treasury yields fell to a two-month low on Wednesday.
U.S. consumers' inflation expectations rose for a second straight month in November despite growing signs that price increases are in fact slowing, a survey released Wednesday showed.
The number of Americans filing new claims for unemployment benefits fell more than expected last week, but that likely does not change the view that the labor market is slowing amid higher interest rates.
Fed officials agreed at their last policy meeting that they would proceed "carefully" and only raise interest rates if progress in controlling inflation faltered, the minutes of the Oct. 31 to Nov. 1 gathering showed on Tuesday.
Lower interest rates decrease the opportunity cost of holding gold.